194-O TDS on Payment of certain sums by
e-commerce operator to e-commerce participant
Explanation. For the purposes of this
e-commerce operator to e-commerce participant
As proposed in the Union Budget 2020, in the Income-tax
Act, the following section shall be inserted, namely.
Act, the following section shall be inserted, namely.
(1) Notwithstanding anything to
the contrary contained in any of the provisions of Part B of this Chapter,
where sale of goods or provision of services of an e-commerce
participant is facilitated by an e-commerce operator through its digital
or electronic facility or platform (by whatever name called), such
e-commerce operator shall,
the contrary contained in any of the provisions of Part B of this Chapter,
where sale of goods or provision of services of an e-commerce
participant is facilitated by an e-commerce operator through its digital
or electronic facility or platform (by whatever name called), such
e-commerce operator shall,
at the time of credit of
amount of sale or services or both to the account of an e-commerce participant
amount of sale or services or both to the account of an e-commerce participant
or
at the time of payment
thereof to such e-commerce participant by any mode, whichever is earlier
thereof to such e-commerce participant by any mode, whichever is earlier
deduct income-tax at the rate of
one per cent. of the gross amount of such sales or services or both.
one per cent. of the gross amount of such sales or services or both.
Explanation.––For the purposes of
this sub-section, any payment made by a purchaser of goods or recipient of
services directly to an e-commerce participant for the sale of goods or
provision of services or both, facilitated by an e-commerce operator, shall be
deemed to be the amount credited or paid by the e-commerce operator to the
e-commerce participant and shall be included in the gross amount of such sale
or services for the purpose of deduction of income-tax under this subsection.
this sub-section, any payment made by a purchaser of goods or recipient of
services directly to an e-commerce participant for the sale of goods or
provision of services or both, facilitated by an e-commerce operator, shall be
deemed to be the amount credited or paid by the e-commerce operator to the
e-commerce participant and shall be included in the gross amount of such sale
or services for the purpose of deduction of income-tax under this subsection.
(2) No deduction under sub-section
(1) shall be made from any sum credited or paid or likely to be credited or
paid during the previous year to the account of an e-commerce participant,
being an individual or Hindu undivided family, where the gross amount
of such sale or services or both during the previous year does not exceed
five lakh rupees and such e-commerce participant has furnished his
Permanent Account Number or Aadhaar number to the e-commerce operator.
(1) shall be made from any sum credited or paid or likely to be credited or
paid during the previous year to the account of an e-commerce participant,
being an individual or Hindu undivided family, where the gross amount
of such sale or services or both during the previous year does not exceed
five lakh rupees and such e-commerce participant has furnished his
Permanent Account Number or Aadhaar number to the e-commerce operator.
(3) Notwithstanding anything
contained in Part B of this Chapter, a transaction in respect of which tax has
been deducted by the e-commerce operator under sub-section (1), or which is not
liable to deduction under sub-section (2), shall not be liable to tax deduction
at source under any other provision of this Chapter:
contained in Part B of this Chapter, a transaction in respect of which tax has
been deducted by the e-commerce operator under sub-section (1), or which is not
liable to deduction under sub-section (2), shall not be liable to tax deduction
at source under any other provision of this Chapter:
Provided that the provisions of this
sub-section shall not apply to any amount or aggregate of amounts received
or receivable by an e-commerce operator for hosting advertisements or providing
any other services which are not in connection with the sale or services
referred to in sub-section (1).
sub-section shall not apply to any amount or aggregate of amounts received
or receivable by an e-commerce operator for hosting advertisements or providing
any other services which are not in connection with the sale or services
referred to in sub-section (1).
Explanation. For the purposes of this
section, –
(a) “electronic commerce” means the
supply of goods or services or both, including digital products, over digital
or electronic network;
supply of goods or services or both, including digital products, over digital
or electronic network;
(b) “e-commerce operator”
means a person who owns, operates or manages digital or electronic facility or
platform for electronic commerce and is responsible for paying to e-commerce
participant; (Say Swiggy, Amazon etc.)
means a person who owns, operates or manages digital or electronic facility or
platform for electronic commerce and is responsible for paying to e-commerce
participant; (Say Swiggy, Amazon etc.)
(c) “e-commerce participant”
means a person resident in India selling goods or providing services or both,
including digital products, through digital or electronic facility or platform
for electronic commerce; (Business listed on Swiggy , Amazon etc)
means a person resident in India selling goods or providing services or both,
including digital products, through digital or electronic facility or platform
for electronic commerce; (Business listed on Swiggy , Amazon etc)
(d) “services” includes ‘fees for
technical services’ and fees for ‘professional services’, as defined in the
Explanation to section 194J
technical services’ and fees for ‘professional services’, as defined in the
Explanation to section 194J
Summary of Section 194-O
1. E-Commerce operator (e.g.
Swiggy, Amazon) will deduct TDS from remittance to business listed on their
platform.
Swiggy, Amazon) will deduct TDS from remittance to business listed on their
platform.
2. Recipient means business
listed on E-commerce operator’s platform.
listed on E-commerce operator’s platform.
3. Such deduction will be
done at the earlier of payment or credit of remittance to the account of recipient.
done at the earlier of payment or credit of remittance to the account of recipient.
4. Rate of deduction will be
1%.
1%.
5. Annual threshold limit
will be Rs. 5,00,000 for individual or Hindu undivided family subject to
availability of PAN. If PAN not provided this threshold not applicable
will be Rs. 5,00,000 for individual or Hindu undivided family subject to
availability of PAN. If PAN not provided this threshold not applicable
6. In case PAN/Adhar not provided
by recipient then TDS @ 5% will be deducted u/s 206AA
by recipient then TDS @ 5% will be deducted u/s 206AA
